LightSquared Proposes New Financing as Way to Emerge From Bankruptcy

Wireless communications company LightSquared may have a path out of bankruptcy that lets its biggest shareholder, the billionaire hedge fund manager Philip Falcone, retain some of the control he has sought.

Lawyers for LightSquared filed documents in a New York bankruptcy court, outlining a plan to bring in at least $1.25 billion in new equity and $2.75 billion in loans. The plan is backed by Fortress Investment Group, Harbinger Capital Partners, JPMorgan Chase and Melody Capital Partners. The move caps a tumultuous year for LightSquared. The company has been at the center of a continued feud between Falcone, who runs Harbinger, and Charles Ergen, the satellite television mogul and the chairman of Dish Network. A federal bankruptcy judge, Shelley Chapman, will review the proposed financing plan.

[Dec 26]